According to Reuters, JPMorgan Chase & Co. (NYSE: JPM) announced plans to offer robo-advisers to some clients by next March in efforts to power up on lower-cost computerized investment management tools. The firm wants to start testing the service this week with a little less than 100 employee accounts to start offering a low-cost way to receive basic advice and automated portfolio management. Services include asking questions which then follows suggested investments such as diversified exchange traded funds. These are often selected by an investment committee as computers rebalance portfolios according to present rules.
These robo-advising services could be managing more than $10 trillion within a few years and start off with fees ranging from 25-50 basis points annually totaling to about $2.50-$5 per $1,000 invested which is less than the roughly 100 basis point fees that financial advisers charge. The $5,000 minimum investment being used during testing with employees will be lowered as well after fees will be set for the public by this March.